Penn West sets out survival plan in face of money woes and legal battles

05/13/2015 05:50 EDT
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Updated
05/13/2016 05:59 EDT

CP

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CALGARY - Beleaguered light-oil producer Penn West Petroleum Ltd. set out a survival plan at the company's annual general meeting Wednesday as the company works to move past lawsuits and debt.

Company president and CEO David Roberts told shareholders Penn West will be focusing on improving the performance at its Cardium oil development in Alberta and its Viking oilfield in Saskatchewan, while other assets are up for sale.

Penn West has slashed capital spending for the year by $215 million to $625 million. Despite cost-cutting efforts, losses for the company last quarter totalled $248 million or 49 cents a share, close to three times higher than losses of $89 million or 18 cents a share in the first quarter of 2014.

Besides its financial troubles, Penn West is facing six lawsuits in Canada and one in the United States related to flawed accounting practices the company disclosed last year.

Roberts said the company plans to fight the lawsuits "with vigour", adding that the account problems have since been resolved.

In the past year, the company's share price has dropped more than 70 per cent and now sits at around $2.65. But Roberts said he expects the price to go up as investors recognize the company's restructuring.

"We've hammered on the debt, we've hammered on our operational capabilities, and we think over time people are going to respond to that."